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Products > Banking > Loans > IRP Line of Credit

Insured Retirement Program Line of Credit: Understanding

An Insured Retirement Program (IRP) Line of Credit gives permanent life insurance clients the opportunity to access the cash that is accumulated within their policy, tax-free. IRP is secured by a client's Manulife permanent life insurance policy. Upon death of the insured, the policy proceeds (less the loan and interest repayment) pass on tax-free to the beneficiary.

If the insurance policy is not with Manulife Financial and is a Whole Life or Par Policy with one of the following Approved Life Insurance carriers: Canada Life, Great West Life, London Life, Sun Life, BMO Insurance, RBC Insurance, Industrial Alliance, Desjardins Insurance, Ivari, Empire Life or Equitable Life, please select the following link:

IRP Other Approved Life Carriers

For Manulife Financial policies follow the instructions below:

Product Details

Key product specifics are included here. For more details, including principal repayment, transaction fees, etc., please refer to the IRP Line of Credit Advisor Product and Marketing Guide (AB0304E) (PDF).

Eligible clients Canadian Residents with Cash Surrender Value in Manulife permanent insurance policies.
Loan amount

Up to 75% of the current cash surrender value (CSV) of the assigned life insurance policy.

Up to 90% of the current cash surrender value of the assigned life insurance policy for self-funding Performax and Performax Gold policies; or 10 or 20 Pay Manulife UL.

Margins

For loan amounts of 75% of CSV, if the line of credit balance increases to 85% of the CSV, a margin call will be made. For loan amounts of 90% of CSV, if the line of credit balance increases to 95% of the CSV, a margin call will be made.

Within five business days, the line of credit balance must be reduced to the original loan amount.

Collateral Manulife universal life and participating insurance policies, including Manulife UL, InnoVision, Security UniversalLife, Performax, Performax Gold, UL 100 and eligible Dominion Life, NAL policies and Standard Life. For Maritime Life Products, please consult with Tax and Estate Planning Services for guidance.
Client access Clients can access their IRP Line of Credit by cheque, ABM withdrawal, direct payment purchase, bill payments and Internet and telephone transfers. Corporate lines of credit do not have ABM and debit purchasing privileges.  

How to set up an IRP Line of Credit 

  1. Speak to your Manulife Financial representative about submitting an IRP presentation. Forward the following documents listed under the 3 scenarios, to Manulife Bank.  Forms are available on Repsource (manulife.ca/repsource) or from your Manulife Bank representative.
  2. For Personal Borrowing IRP Lines of Credit applications that have a credit limit up to 75% of cash surrender value (CSV), please submit:
    1. Insured Retirement Program Line of Credit Application (AB0807E)
    2. Security Documentation
      1. Non-Quebec: Assignment of Life Insurance Policy (AB0185E) OR
      2. Quebec: Hypothec on Life Insurance Policy (AB0736E)
    3. Application fee (0.25% of the loan amount, minimum of $250) for a personal IRP with a corporate life insurance policy as collateral also complete the personal Borrowing using a Corporate Life Insurance Acknowledgement and Disclosure form (AB0816E).
    4. Personal client void cheque (If client wishes to make monthly interest payments) or
      1. If the Payor is different than the Applicant (and is an individual) (an “Individual Payor for a Personal Line of Credit”), please submit a personal void cheque for the Payor and have the Payor complete the Identification Verification Form and Signature Card (AB0487E); or
      2. If the Payor is different than the Applicant (and is a business) (a “Business Payor for a Personal Line of Credit”), please submit a business void cheque for the business Payor, the Officer’s Certificate for Pre-Authorized Payment Authorization (AB0723E) and have the business Payor complete the Business Declaration Form (AB0705E).

For personal IRP lines of credit applications that have a credit limit up to 90% of cash surrender value for Performax and Performax Gold policies or 10 or 20 Pay Manulife UL or Manulife UL, please submit:

  • Documents as listed above for personal lines of credit that are 75% of CSV; plus
  • Most recent 2 years T-1 Generals and Notice of Assessments
  • Investment Portfolio Statement

For ALL Corporate Borrowing IRP Lines of Credit, please submit:

  • Insured Retirement Program Line of Credit Application (AB0808E)
  • Credit Application for the principal of the business, acting as guarantor (for credit review purposes) (AB0208E)
  • Security Documentation
    • Non-Quebec: Assignment of Life Insurance Policy (AB0185E) OR
    • Quebec: Hypothec on Life Insurance Policy (AB0736E)
  • 2 most recent year-end comparative financial statements from the borrowing corporation
  • Articles of incorporation, Partnership Agreement or other Goverment Business Registration documents
  • Application fee (0.25% of the loan amount, minimum of $250)
  • Business Declaration Form (AB0705E)
  • Business Void Cheque (from the Business Applicant for pre-authorized payments)
  • Officer's Certificate for Pre-Authorized Payment Authorization (AB0723E)

Please return these signed documents to Manulife Bank either by fax (preferred) or mail:

Fax:      1-866-236-7317
Mail:     Manulife Bank, 500 King Street North, P.O. Box 1602, STN WATERLOO, Waterloo, ON, N2J 4C6

NOTE: The above are typical requirements for most applications.  However, Manulife Bank reserves the right to request additional information and documentation for credit adjudication purposes.

  1. Manulife Bank will review the application and, upon approval, forward an IRP Line of Credit agreement illustration to you for your client's signature.
  2. When Manulife Bank receives your client's signed documents, the IRP Line of Credit will be activated and we'll send your client a complimentary supply of personalized cheques and an Access Card. Access Cards are available for personal lines of credit only. 

Other things you should know

  • The above are typical requirements for most applications.  However, Manulife Bank reserves the right to request additional information and documentation for credit adjudication purposes.
  • Requests involving corporately owned policies, or policies where the death benefit is payable to a corporation, require a solicitor’s letter of opinion (standard Manulife Bank guide is available) at the client’s expense, if the credit limit is greater than $500,000.
  • Participants are cautioned to limit their exposure in investments with market risk to reduce the probability of a margin call due to market fluctuations.
  • For personal IRP Line of Credit arrangements, the borrower must be the same as the policy owner and the life insured.
  • For joint life insured policies, each life insured must sign.

Advisor Compensation

You will earn 20 bps annual compensation, paid monthly, based on the minimum monthly balance on accounts in good standing.

Contact us

If you have an underwriting question about a loan in process or a concern regarding an existing IRP Line of Credit, contact Manulife Bank Lending Services at 1-800-567-9170.

If you have any questions about this product or about the forms included here, please call advisor sales support at 1-800-567-9170 from 8am - 8pm across Canada.

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